It’s no secret that kei car enthusiasts have been having a rough time. From tariffs on imported cars to various states waging war against these tiny 25-plus-year-old JDM cars, it’s recently grown harder to import a tiny, sub-660 cc car to America. However, if the White House gets its way, enjoyers of small cars might not have to wait to import them, because the government wants to see them made and sold in America.
On Wednesday, the White House held a press conference where President Donald J. Trump announced less stringent Corporate Average Fuel Economy standards.
However, at roughly 11 minutes and 51 seconds into the livestream, Trump announced some completely unexpected news. Here’s the unedited quote, straight from the President:
One of the other things we’re doing—it’s separate from this meeting but I think everybody here would agree with it—if you go to Japan where I just left, and if you go to South Korea and Malaysia and other countries, they have a very small car—sort of like the Beetle used to be with the Volkswagen—they’re very small, they’re really cute, and I said “How would that do in this country?” And everyone seems to think good but you’re not allowed to build them, and I’ve authorized the secretary to immediately approve the production of those cars, so you’ll be able to buy the—they really are, some of them are really beautifully actually if you take a look. Honda, some of the Japanese companies do a beautiful job, but we’re not allowed to make them in this country and I think you’re gonna do very well with those cars, so we’re gonna approve those cars.
Present at the conference was Stellantis CEO Antonio Filosa, who stated, “Thank you very much also for this great news of the kei cars,” to which Secretary of Transportation Sean Duffy responded, “Yes.”
Whew, there is a lot to unpack here: questions about what barriers actually exist for kei cars in America, what changes are actually being made to permit new kei cars on American roads, whether domestic production of kei cars is viable, and, of course, whether this pledge will actually play out as promised. We don’t want to count our chickens before they hatch, so let’s take a look at several of these barriers.
One solid argument against kei cars is that some of them might not be as safe as cars already sold in America. After all, U.S.-market cars must pass unbelted occupant crash testing, a strenuous process that’s kept certain cars away from these shores. The Alpine A110, for example. In addition, Federal Motor Vehicle Safety Standards deviate from the UNECE standards most of the world uses, so some market-specific changes would be necessary. Headlights would need to be changed, amber front retroreflectors would need to be added, that sort of stuff. While the Mitsubishi i-MiEV proved it’s technically possible to sell a modified kei-class car in North America, there are a few reasons why we haven’t seen many of them sold new in America.
Firstly, let’s talk about the EPA’s footprint rule for a second. From 2008, Corporate Average Fuel Economy standards included a modifier based on a vehicle’s footprint, calculated using its wheelbase and track width. Under this structure, larger cars could emit more pollutants while smaller cars had to emit fewer pollutants. For example, in 2011, cars with a footprint of less than 40 square-feet would’ve needed to achieve a CAFE rating of 31.2 MPG, while cars with a footprint above 55 square feet would’ve needed to achieve 24 MPG. Those numbers don’t seem like a huge deal, except that at the time, the proposed standards for 2025 were 61.1 MPG and 45.6 MPG, respectively. While the CAFE MPG and the number on a window sticker aren’t the same, the footprint rule makes it somewhat punitive to sell small cars in America.
Reading between the lines, it certainly seems like this proposal would legalize U.S.-built kei cars, and that’s where another potential sticking point comes in. When we’re talking about truly inexpensive cars at the bottom of the market, labor costs make up a considerable portion of their wholesale prices. If kei cars were to be built in America, they might not be as cheap as some people hope. At the same time, who knows if imported kei cars will be legal? Given current pricing plus tariffs, an $11,390 Honda N-One could be Nissan Versa money if it were to land in America.
The Autopian reachd out to the DOT about all of this, and it didn’t really answer any of our questions, so much as repeated what Secretary Duffy said on CNBC the next morning. This is exactly what it sent us:
Secretary Duffy on CNBC today“He [the President] called me after the meeting, actually, and said, let’s change the rules. And so I worked with NHTSA. We’re in the process clearing the deck. Listen, if there’s a market for those vehicles, I want to give our manufacturers the opportunity to build those cars. And so we are and it’s going to clear the deck, clear the rules and let them build those small cars. And again are they going to work on the freeways? Probably not. But again, vehicles that work in cities and if that’s where you drive, it could be a great solution for you. And by the way, much more affordable than other options that are on the market today.”
Then we get to the final question: Would the general public even want kei cars in America? While inexpensive cars have seen a resurgence in popularity, kei cars are an order of magnitude smaller than even a Nissan Versa. We’re talking 11.2-foot-long cars with engines displacing less than one liter and zero-to-60 MPH acceleration times usually in the double-digits. They’re economical and inexpensive, but a used Camry is physically a whole lot more car. It can cruise on Texas’s 80 MPH toll road without breaking a sweat and comfortably seat three adults across the rear bench, useful stuff in a nation of long commutes, high-speed roads, and relatively inexpensive fuel. While a domestically-made kei truck would be useful for urban deliveries and light farm work, kei-class passenger cars are a harder sell.
While it’s certainly interesting to hear the White House paving the way for U.S.-market kei cars, the battle to bring truly small cars back to America has only just begun.
Even after that DOT response, it’s still not clear what barriers would need to be lowered or have been earmarked for alteration in order to sell new kei cars in America, and we still don’t know if consumer demand truly exists outside of cities and some commercial uses. Needless to say, we’ve reached out to Honda and Toyota for comment and will update you should we hear further developments.
Top graphic image: Honda, DepositPhotos.com
[Editor’s note: I emailed the DOT yesterday when this story dropped, and it got back to me today (Thursday, the 4th). I’ve added its statement above. – Brian]
To everyone crapping on the idea, you forget that between 2008 and 2020 interest rates were close to or literally 0%. It cost you very little to finance way more vehicle than you needed. We don’t live in that imaginary world anymore. At 5-9 % interest, the actual cost of the vehicle matters much, much more than it used to.
Additionally, the used market is filled with problematic, high technology vehicles that are very expensive to maintain at old age. The average age of vehicles on the road is at record highs.
If cheap, and mechanically simpler cars are made legal to buy, there is a large market that has been completely ignored out of regulatory compliance. You’re not courting the modern egg car buyer, you’re courting the 20 something that is still driving a 2004 Sentra they bought in highschool and are praying it doesn’t break down driving to work this morning. Same market segment the Slate truck is targeting.
Yes, that “beginner” market needs a lot of help. My son is driving a 2010 Soul and wants to replace it, but anything in his price range of used cars is no better. I’d love to see him be able to get something new(er) at a reasonable price, and until he has a family he has no need for a bigger car. His favorite at the moment is the Fiat 500 Abarth, so I’m sure he’d love a kei car if he could get one in better shape than what he has now.
The 20-something without a huge paycheck crowd really does need reliable transportation so that they don’t lose the crappy job they have managed to secure. For that matter, a retired empty-nester has no need for a big car either, and on a fixed income something small, cheap, and easy to maintain would be a boon.
Agreed. We’re missing simple cars these days, such as the first gen Honda Fit. What we still have available is the spiritual successors to the Chevy Cruise, which was cheap for all the wrong reasons and over complicated in the worst ways.
You can easily get a refreshed (2018 – 2022) Chevy Spark with less than 100K miles for less than $10,000.
Look a little harder and you can get that down to $7K to $8K for a car made in the 2020’s. (Shopping for Sparks at the moment)
Yes a COVID era car that’s been through every round of GM cost cutting is totally a great idea. Make sure you get one with the CVT for extra spice. /s
The best use for those Sparks are drag racing push cars, just like a Smart ForTwo.
The Spark is a simple car – with a simple 4 Cylinder NA engine, available with a 5 speed manual. I had a 2016 Spark EV and it was a fine commuter.
Don’t want a Spark? Buy a Sonic, Mirage, Versa, Kicks, Corolla, Yaris, Fit, Trax, Encore Fiesta, Accent, Rio, Soul, Sentra ….
There are literally thousands of small cars and crossovers 2018 or newer listed for sale with less than 100K miles for less than $10K
No, I’m not forgetting the short and temporary period of time when interest rates were artificially low.
I also remember when I bought my first new car in 2000 and paid 9.9%. I also remember when my parents were paying 15% to finance a car and the same for a 30 year mortgage.
I also remember buying simple cars from the 80’s as my first car in the 90’s and they were absolute total garbage that fell apart in less than 100K miles.
My first new car was a 1989 Mercury Tracer
Financed at 13%.
I’m curious if you liked it. I had one ( I bought it slightly used ) and loved it … until the heater stopped working ( I live in Wisconsin ) and no one, including the dealer, could figure out how to fix it.
It was a really good car – although slightly boring, as Ford/Mercury damped down the controls to the point of numbness.
I should have kept it for longer than I did.
You’re making my point. We don’t live in the infancy of computers anymore, but we do have the interest rates. The average cost of vehicles ($50k) is ten grand more than an inflation adjusted average 2014 vehicle. The bottom of the market has been ignored.
The average (mean) cost of a new vehicle is pretty meaningless as it is heavily influenced by vehicles on the high end and a shift by buyers up the chain. The cheap cars are still there – people just are buying fewer of them.
The median would be more useful and it is quite a bit lower than the mean (which is likely why it gets no press)
The bottom of the market isn’t being ignored either. However, inflation and rising wages have moved that bottom to $20,000.
In 1995 a Geo Metro was GM’s cheapest car. It cost $8,395 when the median US household made $34,080. That is 12.8 weeks of income to buy a Metro.
In 2024 the Chevy Trax was the cheapest car GM. It started at $20,490 and the median US household income was $83,730. That is 12.7 weeks of income to buy a Trax
30 years later and the bottom of the auto market is in the same place relative to average (median) income. That buyer is also getting a LOT more for their money today than in the past.
Does that median include incomes like Elon’s?
I don’t think most people grasp how close to the edge most people are now.
What do you think people that broke can finance anyway?
First time I visited Austin, ages ago, everyone either made $3 an hour or comfortable money for a tech company.
Not much in between.
Yes, the median includes Elon Musk although Musk has little effect on the median.
The median is the number in the middle of a group. Line every income up from smallest to largest and then pick the one in the middle.
The mean is what most people think of as the “average” and that is adding up every income and then dividing by the number of incomes.
Say we have 5 car sales. $20K, $25K, $30K, $35K, $200K.
The Median is $30K
The Mean is $62K
I thought so.
I took engineering math, but don’t need it often.
Either way, it misrepresents the problem of what more appropriately should be called subsistence workers.
No way to build up savings, no fair deals on insurance or loans, and often owning cars they can’t afford to repair.
The working poor aren’t new but they are a bigger share than in the past. The data shows the pattern you mentioned in Austin.
While the median is the median the distribution is not as even as in the past. The number of middle class households is shrinking and those people are splitting into the working class and upper income. More are moving up than down the income ladder which moves the median up but doesn’t change the reality for the people being left behind.
At the same time growing income inequality is not a problem for automakers to fix.
They might find it wise to address the loss of entry level customers before someone outside the industry tries to do it for them.
As long as USA is a country essentially without mass transit, lack of affordable transport affects everything else.
The way to address a customer that cannot afford a new car is to sell them a CPO used car. It isn’t selling them a new car at a loss.
Lack of affordable transport for workers is an issue. In other parts of the world it is addressed by companies running their own bus lines to transport workers to and from work.
Companies address their own concerns. It is up to government to address larger societal concerns.
I asked this the last time there was a mean new car price because medians are generally more useful when there’s only outliers in one direction (which is often the case when you’re looking at a data set of only positive numbers) and while I don’t remember the exact answer the median price was lower, it was not markedly so – like maybe $1,000.
I have not seen a median new car price for at least a decade – can’t find one today either.
What I can find is averages by market segment which show how much the US fascination with driving full size trucks skews the numbers and how much extra buyers are paying to drive a crossover instead of a sedan in the same class size.
$24,061 – Subcompact Car
$27,003 – Compact Car
$30,594 – Subcompact SUV / Crossover
$33,524 – Midsize Car
$36,517 – Compact SUV / Crossover
$48,650 – Midsize SUV / Crossover
$64,780 – Full-Size Truck
$77,568 – Full-Size SUV / Crossover
$132,999 – High Performance Car
In the Compact class choosing a crossover over the sedan we used to buy adds $9,514 on average. Step up to midsize and the penalty is $15,126.
This says nothing about CAFE standards which have encouraged the move away from cars, especially compact/sub-compacts.
You are absolutely correct. CAFE was very punitive to small cars, despite being the most efficient.
I would like to have a car built exactly like the early Honda Insight, but more functional.
Possibly just a gas engine?
In order to not hurt a manufacturer’s CAFE rating, something that small would have needed to hit high 50’s, low 60’s, for combined MPG rating.
My friends worn out Insight does 50 on long trips, did 80 routinely when new.
But I agree that rule is clearly skewed.
That’s just it though. Getting 50 when the rules say you need 60, hurts your fleet average way more than a significantly more profitable truck getting 24 instead of 25.
And that’s the insight being a hybrid, not a pure ICE vehicle.
My friends Insight has a rescued battery pack because the car will not operate without it, but the hybrid part is not really in play.
50 mpg in a car with hundreds of thousands of miles isn’t terrible.
On flat ground at highways speeds I wouldn’t expect benefit from the hybrid part anyway.
80 mpg was routine early days.
And the Insight build quality is holding up better than my 2005 4 cyl Camry.
Yep; a 2005 Corolla is worth more or equal to a BMW 5-series of the same vintage.
Late to the party, but I’m just not seeing it. The Honda Fit was one of the best selling small cars in America and even it couldn’t sustain enough sales for Honda to keep it around. America had tons of small and tiny cars not too long ago. There was the Ford Fiesta, Mazda 2, Toyota Yaris, Chevy Sonic, Chevy Spark, and probably more that I’m forgetting. None of them are around anymore. Even the Mitsubishi Mirage eventually kicked the bucket.
Smaller than those? The Scion iQ, Fiat 500, and Smart Fortwo. No member of that trio could say they had good sales. I highly doubt there’s a long list of people who want a tiny 64 HP car that would feel winded at realistic American highway speed (75-80 mph) and will disappear in front of the hood of a pickup truck.
I guess an American Kei could have a larger engine. But you have to remember that these cars already have to be modified to our standards. Then, in order to dodge tariffs, these cars will have to be built here. I doubt this would be done cheaply enough to keep a Kei at an attractive enough price.
Americans might say they want a cheap “people’s car,” but we clearly don’t buy enough cheap cars for automakers to care. I’m not convinced that bringing even smaller cars here is the antidote to that, and I say that as someone who adores and owns Kei cars.
maybe would people go in for a small commuter? I would. I signed up for the slate but am about to snag a Corolla, so I don’t know
Honda was selling over 50k Fits a year until 2017 when it started to slip in sales, but I’d imagine there were other factors that came into play for that time, and the average person certainly can feel that we’re in a recession period more like the late 00s and early 10s when they were at their peak sales. People aren’t lining up to buy cheap people’s cars because they barely exist anymore. The options for cars under $20k aren’t particularly great either, just boring compact sedans of dubious quality that scream I BOUGHT THE CHEAPEST CAR; the kei stuff gets a lot of envy because they’re still fun despite being practical and economical options.
50K a year is not enough to bother making unless the vehicle has a hefty profit margin.
The Chevy Trax is a cheap car – one of the cheapest in the USA and it sells 200K a year. It sells because it is in the form factor that people want to buy and is actually a decent car. Add in the other variations as GM is selling 350K on the platform with all of them starting at less than $25K
Make it a loss leader, I don’t weep for low margins for the automakers. The Fit sales still represent hundreds of thousands of buyers who need cars and like the small form factor. The Fit especially was a long lasting reliable car that’s great to have in the used market as well. I doubt we’ll see as many Trax last as long as most Fits (I’m not sure I see that many on the road currently but they’re so boring they might just slip by). Who knows how many others get scared away from smaller cars because of the fucking ridiculous behemoths on the road now anyway, in regards to what people “want to buy”. I’m on board with anything that might help deflate SUV and truck proportions in this country, maybe making small cars cool will be part of the solution.
Why should a company make a vehicle and sell it for a loss? Please explain the logic.
I do weep for low margins – as I work for an automaker and my bonus is directly tied to our percentage return on sales. This year it will be basically zero due to tariff costs.
The Fit does not represent hundreds of thousands of buyers. If it was selling hundreds of thousands a year it would still be on sale. The Fit average 51K per year. The 3rd gen saw a little bump then a steady decline to less than 33K when Honda pulled the plug in 2020
I believe the “hundreds of thousands” they were referring to was the Fit’s overall sales, not annual.
But I think you’re both letting your differing perspectives block you from seeing the other person’s point. Honda “only” sold 50k Fits a year, sure, but that was just in the US (and if you average that out, that’s still a thousand Fits per state per year). The Fit was sold in several markets and was a fairly popular choice in all of them, so Honda could spread the development cost out over hundreds of thousands, if not millions of units. And that’s also hundreds of thousands if not millions of people who got a taste for Honda’s products, and might come back at a later date and buy another Fit, or upgrade to an Accord or a CR-V.
But you’re also correct that selling a car on slim margins to a small market is financially unsustainable. If Honda were just selling those 50k Fits per year in the US, and didn’t have other markets or other cars that it shared parts with to back it up, then it wouldn’t last. The price would go up, the sales would go down, and sooner rather than later, production would cease.
So the problem isn’t any one thing (demand, cost, whatever), but it’s that all of those things combine to make it such that unless you have an existing product that you can easily make legal to sell in the US (Fit, Mirage, Versa, Yaris), it just isn’t going to happen. But if you do have that, then we’ve proven that it does work.
My perspective is from working for an automaker and seeing how the sausage is made. Models, Trims, Options – they get cut when they stop making a margin that makes them worth spending the money to make them. Generally that happens when it come time for a redesign or regulations change and a company has to decide whether or not it makes sense to spend many millions and years of R&D to keep selling that car.
The most recent example I was personally involved in was cutting the manual from a model. Happened during the redesign and the manual was 3% of sales. Keeping the manual would have added cost to the automatics – more than the profit from selling the tiny number of manuals. Numbers went up the chain of command and a decision came down to kill the manual. People like to come up with conspiracies but it comes down to dollars and cents.
Yes, a model like the Yaris was / is sold in other markets. That helps with economy of scale and makes it more viable in a small market like the USA. However, it only helps. Honda can’t sell a European or Japanese spec Fit in the USA. It takes many millions of dollars and years of R&D to make a version that meets US regulations. Companies expect a return on those millions and it is really hard to make the numbers work on the low end.
The best thing that could happen for fans of small cars is if the US either harmonized our standards with the EU or at least allowed EU compliant cars to be sold in the USA. If we could just ship a EU spec LHD car to the USA without all the extra cost it would make many more cars economically viable here.
Indeed, our differing safety regulations do make things quite difficult. I mean, I’m all for letting the “local” government decide what the “local” population needs, but I really don’t think we’re doing anything different from the Europeans or Japanese that’s appreciable.
When I was doing interiors we had 6 different versions of the dash for different crash standards and LHD vs RHD.
For safety the EU is ahead as they assume the front seat passengers will wearing a seatbelt while the USA requires automakers to restrain a unbelted adult male. This leads to more powerful airbags that injure small framed people and changes in the lower dash that increase injuries to the lower extremities for belted passengers.
Much has been said about how much better EU standards are for lighting.
Emissions is a bet of a mixed bag. They have stricter regulations for gasoline cars as they have PM and PM count standards that require most DI turbo gasoline cars to have particulate filters like diesels.
Japan adopted EU emission standards as part of the free trade agreement. I don’t know if they have adopted crash standards as well.
Why should car companies want to sell affordable cars?
After reading about the FX16, I told a friend about it and we went to check them out.
We were already fans of the Mr. 2.
We test drove the faster Mister 2 and the FX16, and he bought the FX16.
Absolutely loved it.
Then his son rolled it into a lake, and the insurance company totaled it.
He wanted to replace it, but found Toyota no longer offered that car.
The only thing available was a tarted up version with body cladding, the exact opposite of what the FX16 was, and with the price doubled.
He eventually gave up and overpaid for the base FX, which only resembled the FX16 on the outside.
The tiniest brakes on it, barely had an interior, a sad car.
He never forgot it, never bought another Toyota.
People like us sold those cars, then watched Toyota kill their market by profiteering.
My friend has an unlimited Tesla now, so that’s the customer they burned.
When cars seem to mysteriously lose sales, often there is a clear reason.
“Why should car companies want to sell affordable cars?”
That wasn’t the question. The question was why should an automaker sell a car model at a LOSS.
There is no mystery as to why small cars are losing sales. It is happening across the entire segment at the same time sales of small crossovers are booming. Buyers prefer the crossover form factor. They prefer it enough to pay significantly more for the vehicle.
They’re not selling the Fit at a loss, it’s just not as profitable as other models and the fucked US market is a great excuse to push more profitable models. And yeah like clueless mentioned, it’s overall sales, most of the 50k sold one year still exist the next year and so on. Adds up to hundreds of thousands of buyers and cars, not to mention the used market, likely hundreds of thousands more buyers.
Sorry your bonus is getting fucked, but don’t forget to take a look at what your execs are getting for their bonus this year. I doubt they’re taking a hit.
If the Fit was profitable it would still be on sale here. It isn’t like other small cars where the assembly line was repurposed to build a higher margin product. Honda is still turning out the Jazz for other markets but not the USA.
The Fit died when it was resigned for the 4th gen and it didn’t make sense for Honda to spend many millions to sell 30K (or less) a year while paying CAFE fines on every one sold.
(A Fit in 2025 would be required to get 67 mpg CAFE / 47 mpg EPA combined. )
To add to that, America is poorly designed for Kei cars. They are best suited to cities with little space, which there are in the US, but these are not going to sell enough, because of the other part that is mentioned, culture.
Our culture is not anywhere close to Japan’s, in which kei cars are a part of life because of how rules and regulations brought them to the market. It would take a massive shift in our culture which I don’t ever see happening.
If you’re talking specifically about Kei class Japanese cars, I agree. If you’re talking about similar but not exact, disagree. Smaller cars are incredibly useful in most US cities, especially for parking in what seem to be ever shrinking parking spots. Most importantly, it’s a portion of the market that basically doesn’t exist in the US today.
The one thing I am not sure about is how much of the blame lays upon dealers. Commission-based salespeople would have no incentive to sell smaller, cheaper cars to people.
Sure, but you make more money selling one cheap car than selling zero more expensive cars. If I were a dealer, I’d be looking at the figures and seeing that there are a lot of people in the budget new / low-mid-price used car market, and basically nothing to sell to those people. Used cars are either new enough that they’re nearly as expensive as new cars, or are old and used up or have lots of problems.
That may be the way of things NOW, with car prices being so unaffordable, but historically, dealers had every incentive to upsell people the largest, highest-trim cars they could get their customers into.
Last new car I bought, special ordered, the sales manager told me the salesman only made $25.
I don’t know if that’s true, but I pointed out he took the sale from a competing dealer.
His store had quoted me high when I first went in.
There’s definitely a market for small, cheap cars. It’s not a huge market in America, but it’s there. Those cars just don’t make the kind of profit margins that big corporations like, and they figured out if they just don’t make those cars, people will just buy bigger, more expensive cars on long, high interest rate loans. It’s not a lack of consumer demand, it’s corporate greed.
This is what I came to say, its not that they don’t sell, its that they don’t make as much money. I mean a civic is like $25k to $50k now, and midsize trucks are rough too. You aren’t getting an American one for less than $40k with decent options. The Tacoma maxes out at the starting price of a GX550! BRZ is like $10k more than it was 10 years ago.
Even people that can easily afford new cars have stopped buying them.
Auto manufacturers won’t be the first companies to tank their own industry.
YTD though November S&P Global is showing 14.7 million sales. That is 300K ahead of 2024. We are looking at 16 million +/- vehicles in 2025 which would be the best year since 2019.
There is also the reality that many automakers are no longer chasing market share by overproducing then selling cars with massive incentives.
You should also mention that most kei cars have struggled for sales even in Europe with bigger engines and more conventional gearboxes. Ultimately they are Galapagos cars that make a great deal of sense in the environment they’re designed for but often lose the value comparison in markets that are less size and power constrained.
Oh I think there’s plenty of potential customers here in America IF they have a similar price to their JDM counterparts. So many people are fed up with new and new-ish used cars being crazy expensive, while affordable used cars are on their last legs a lot of the time. A new box on wheels with good space utilization and great fuel economy for under $15,000 should sell like hotcakes, especially if there are multiple such cars on the market so they’re normalized – you’re not automatically recognized as having bought the cheapest car on the market, because there are several similarly priced cars out there.
As for cheap small cars not selling well here in the recent past, have you seen those cars? No, you probably haven’t, because companies barely marketed them if at all. People are unlikely to buy cars they can’t find or don’t know exist… But also, there were barely any options, and most of them were just not good cheap cars. No fun to look at, no fun to drive (and plagued with CVTs), not immune to dealer markups, and not always great quality either. We haven’t had any real cheap AND cheerful cars in a long time. That’s where Kei vehicles come in – they’re heaps of fun! They have fun designs that are full of character, making them instantly appealing to consumers, and as far as I’ve heard they’re pleasant to drive too.
If nothing else, I think they can be a profitable niche product if regulations allow them to be sold here without a substantial redesign from JDM specs. Homologation is expensive and prevents most things from being sold here, but if Kei cars are being legalized, it sounds to me like Kei regulations are being adopted as a new category of road legal vehicle, likely exempting them from size-based CAFE standards.
If one thing does change from Japanese standards though, it should probably be engine size. Even the Kei cars Japanese automakers sold abroad had export market specific versions with larger engines. I’d love a Kei car, but it’ll need to be able to cruise on the highway comfortably (as in, engine not screaming from over-exertion).
Another factor that I think is important to consider is that new Kei cars could be affordable enough for young adults to consider buying one. Younger generations don’t necessarily have the same biases against small efficent cars that older generations do – if anything, there’s an increasing resentment of large, inefficient trucks and SUVs. Kei cars are a way to make a countercultural statement, like the VW Beetle used to be, and they’re a heck of a lot more attainable than something like a Prius.
I for one have assumed that I’d never own a new car, simply because they’re prohibitively expensive and that makes them too big of a risk. If Kei cars were sold here, though? I could actually see myself buying one new, because it wouldn’t be a huge financial burden, and would be extremely useful. So, this news is exciting to me and gives me hope.
“A new box on wheels with good space utilization and great fuel economy for under $15,000 should sell like hotcakes”
NO – They won’t. As recently as 5 years ago you could get a selection of cheap boxes on wheels for $15K – $17K range and they did not sell. Spark, Sonic, Mirage, Yaris, Fit, Rio, Accent. They did not sell and where cancelled. People in that price point will almost alway take a CPO used but nicer car vs the new but cheap car.
I actually had a 2016 Spark EV. It was a small basic car that did all car required things just fine. I’m actually thinking of get a gas version as a toad.
Those cars sold, but they weren’t selling hundreds of thousands of units a year. We’re just in a stage of Capitalism now where manufacturers need everything to be an immediate gold mine of guaranteed massive profit or else they won’t even bother. I have no doubt there would be buyers of kei cars, but it just won’t be worth anyone’s while to sell them here, even if the Orange One somehow makes them legal.
They didn’t sell in high enough volume to make a profit.
No automaker is making massive profit margins. Most risk billions every year to get a profit margin that you can beat with a guaranteed CD or Treasury.
We are at a stage of capitalism where automaker will no longer subsidize the sale of cheap cars with profits from models that actually make money.
“We are at a stage of capitalism where automaker will no longer subsidize the sale of cheap cars with profits from models that actually make money.”
There are two main reasons for that… the footprint rule and modern hybrid/BEV tech.
The first is obvious. With the second, in the past to get a vehicle with great fuel economy, you had to go small and light with a tiny engine.
These days? To get the best fuel economy, you get a BEV… or the next best thing, a regular or plug-in hybrid.
With the large scale production of hybrids and BEVs, many of the people who used to buy small cars switched to larger hybrids or BEVs. Sure they cost more upfront. But the fuel savings negated much of the price difference and they are much more pleasant to live with compared to the small economy car of the past.
Yes, before the footprint rule every automaker had to sell small and underpowered cars to meet CAFE rules. Most where sold at a loss – subsidized by other vehicle sales.
Hybrids and BEVs are why even if we got rid of the footprint rule we will not see a return to small compact cars and hatches.
Dude, speaking as a zoomer, the middle class has shrunk drastically in the last 5 years. More and more hardworking people are priced out of reliable cars, big or small. I’ve known a good handful of people myself who were without transportation for a year +, some of them working multiple jobs trying to make ends meet.
We need a new Geo Metro.
The Trax is the new Metro and it is cheaper than a 1995 Metro
In 1995 a Metro cost the median household 12.8 weeks of work. The 2024 Trax cost 12.7 weeks.
The middle class is shrinking and splitting. Some households are moving up and some down. More households are moving up than down which is why the median household income is increasing after adjusting for inflation.
There are lots of things we can do as a society to address this. It won’t be solved by automakers selling new small cars at a loss.
While the Trax may be roughly the same number of weeks of work as far as cost is concerned, I would be curious as to how many weeks of work a home, home insurance, car insurance, a kid’s college education, a family’s healthcare, etc costs now vs then. Any increase in any of those reduces the number of weeks of work simply available for the car purchase if you catch my drift, i.e. the relative available buying power since the days of the Metro. I’d be surrised if ANY of them are as similar as the Trax/Metro (and yes the Trax is a FAR nicer car than a Metro with the exception of fuel cost however may not exhibit the same longevity.)
The Real Median Household Income is up 28% vs 1995.
(C-CPI includes rent, insurance, heathcare, transportation, education….)
Real Median Household Income in the United States (MEHOINUSA672N) | FRED | St. Louis Fed
Ask potential customers about their dealer experience. I have only had that happen twice. One was Honda.
I had done some work for a gm dealers home and he was very happy.
Made a point of finding who did the work and told me to call him if I was in the market for a car.
Main issue was gm didn’t offer a manual except in a 3 speed, but worse was they quoted me high prices, then steered me to their used lot.
They knew the owner referred me, but didn’t take it seriously, I think.
Later he called me after I had bought elsewhere, and he was furious at his sales people.
I assume since you are talking about 3 speed manuals this was decades ago.
Small cars didn’t die out in the last 10 years because of dealer experience. They have died across the board at every automaker.
GM, Ford, Dodge, Toyota, Honda, Hyundai, Kia, Nissan, Mitsubishi, Mazda, VW. All of them dropped their smallest car and some multiple small cars.
But the only impact eliminating regs will have to make this happen is to make it possible for it to get lower gas mileage and have lower crashworthiness.
You can buy a Kia K4 today for <23k with 190 hp, multiple airbags, a suite of safety sensing equipment, and gets 29 city/39 hwy. Is anyone really lining up to pay 15k for a car with no standard safety equipment that also can’t get out of its own way but still only gets 30 mpg?
No, at least not in the real world of people paying for things with their own money.
People that understand it will pay for repairable cars.
Yes please!! And can we import them with manual transmissions??
Skeptical. https://www.washingtonpost.com/graphics/politics/trump-claims-database …and that’s as of four years ago!
I’d get an N-One before a Versa for the same price
I find it ironic that he thinks by eliminating regulation they will suddenly create a market in the US for a product that explicitly exists only because of very stringent regulation.
If not for the taxes, laws, and regulations in place in Japan kei cars wouldn’t be a thing, and if Japan ever adopted the US’s regulatory and taxation environment they’d cease to exist there, too.
“Thinks” isn’t an accurate description of what he does.
The personal irony of this is that starting a family that includes a 90lb (fit) dog means that Kei Cars are too small for my needs after all these years of being a single guy wanting them.
That being said the elimination of things like the footprint rule will hopefully allow for more space efficient vehicles.
Honestly I’m starting to get why the pickup is the #1 vehicle in the US. with the Leaf I can hardly fit a couple people worth of stuff, let alone 5 people worth of stuff, with a pickup you can.
Of the current crop of vehicles and upcoming vehicles, the Ramcharger is probably our best fit.
I can’t help but believe that when the average cheap car buyer (ie, non-JDM enthusiast) contemplating a US Spec Kei car pulls up next to a Ford Super Duty during their test drive, they’ll sulk back to the dealership and start looking at whatever ‘traditional’ compact cars or used midsized vehicles are sitting on the lot.
Either that, or they’ll try to squeeze under the truck between the front and rear axles ala Clark Griswold.
Hell yeah! I think a larger market always helps, and kei cars being cheap would probably lead to a pretty big market segment that the domestics would scramble to compete in, which leads to a larger market, and the cycle repeats. All in all this is good for the car community, and people crapping on it should learn to live and let live. Lets bring back the $9999 Hyundai Accent type cars. (crazy that the last time a sub $10000 car was sold in the states was 16 years ago now)
p.s. the comment meltdowns make me sad y’all come on now
Why was my comment deleted?
“, but we’re not allowed to make them in this country”
That’s yet another Crooked Trump lie. Crooked Trump couldn’t tell the truth if his life depended on it.
The truth is any company can sell them… provided they build them in such a way that it passes North American standards.
But companies don’t bother with that because small cars don’t sell in large enough numbers to be worth it.
“and I think you’re gonna do very well with those cars, so we’re gonna approve those cars.”
And once again Crooked Trump demonstrates that doesn’t know what he’s talking about. If he did know what he was talking about, the first thing he’d do is ditch the tariffs. The second thing he’d do is ditch the CAFE footprint rule that goes easy on large vehicles and hard on smaller vehicles.
And next he’d have it so all vehicles get treated the same in terms of fuel economy regardless of whether they are ‘cars’ or ‘trucks’..
And the next thing after that would be (if he wasn’t lying out of his ass) restoring the CAFE penalties for not meeting standards.
And beyond that, if he REALLY wants Kei cars, then they have to accept Japanese safety and emissions standards at the Federal level
Doing that would then likely make it feasible for Japanese companies to start exporting Kei cars to the USA.
And if he was super-duper serious, then he’d also ditch other things like the Chicken tax and the 25 year import rule.
I’m 99% sure Crooked Trump and his gang of crooks and jackasses will do NONE of these things.
Nominally the argument here is that the footprint rule did away with small cars because it was too cumbersome to meet 60 mpg requirements or whatever, which I think probably did contribute. Policy is hard to sculpt without introducing weird effects and even potential backfires.
That said, what’s the actual result of removing that restriction or safety regulations? Is it Kei-car size vehicles that get 30-35 mpg and only have a single driver airbag and poor crash results and still costs $15k? And then it barely wheezes its way along the freeway? You can pickup a base Corolla today for ~24k and have far more comfort, safety, and efficiency than that. I know that’s a big difference in price, but the kei car is still a tough sell, especially compared to a 5 year old corolla at the same price.
I’m for small cars, and I like more options, but I’m not buying the line that it’s regulation that has eliminated choice. People like the products that are the result of regulation, and trying to sell them something that doesn’t meet those expectations isn’t going to be profitable.
Honda N-One gets 67mpg. Even my thirty-year old kei car gets 45+ mpg in NYC and Long Island driving. Said N-One also has two front airbags and the option of side curtain airbags and front seat i-side airbags.
I still agree, though; the US market for kei cars is practically nonexistent unless Japanese regulations, street widths, and fuel prices are also adopted.
Yeah, I guess what I’m trying to point out is that the claim that cutting regulations will suddenly make kei cars viable in the US is ridiculous. The N-One example further undermines that claim, since in its current form it would probably be easy and inexpensive to adapt to existing US regulations.
This is just flimsy cover to strip regulation and make big business happy while convincing customers it’s for their benefit.
I don’t think there is any thought at all – he just saw some nice keis and said “why can’t we have these in the US” and then blurted out some words. I wouldn’t be surprised to find out that manufacturers take advantage of this to get rid of some regulations, though.
I can nearly guarantee that Trump never looked at a standard Japanese street and had any positive feelings about kei cars at all.
To me, this reads as someone in the admin (or a business leader who bribed their way close enough) was angling to get him to eliminate CAFE and were just launching out all their standard arguments about how “regulations keep Americans from choosing what they want” and the example that stuck in his feeble little brain was kei cars.
And then he blurted out some words that fortunately aligned with slashing regulation and gave flimsy cover for his base that this wasn’t just about the exorbitantly wealthy eliminating barriers to accruing more wealth at the expense of the everyman.
Trump’s brain is cooked, and he’s definitely out here just blurting shit out, but those around him are doing their utmost to control what gets into his head and try to shape it so the outbursts end up benefiting them.
That’s why the Mamdani meeting was such a surprise and why it will never happen again. Anyone who can charm Trump can get him to say whatever they want.
I also believe Trump is disgusted by his team of sycophants – meeting someone charismatic that doesn’t bow to him must have quite the kick for him.
I think his meeting with Mamdani actually makes a lot of sense. Cheetolini is obsessed with being in the spotlight.
Mamdani despite opposition from both the Republican And the long established Democrats was able to win the NYC mayoral race with what most NYCers saw as common sense for the people approach.
Cheetolini likes to try to attach himself to anything that is ‘winning’ and keeping himself in the spotlight
Yeah, you’re probably right – Trump wandering about and looking at things, enjoying himself is pretty unlikely.
I have no opinion on the practicality or feasibility of selling kei class vehicles in America. It’s clear there’s some market for them, given how readily small businesses bring over kei cargo vehicles.
I *do* have an opinion on it actually happening: ha. ha ha ha. ha ha ha ha ha.
The steady stream of word salad vomit out of a sun-downing child predator happened to contain a description of a kei car, because he was in Japan recently. That has approximately zero relation to reality or regulatory changes happening at an agency he pointlessly gutted.
I get why this was reported here but like. Not gonna happen.
The market for kei cars in the US only exists because it’s something different and fun that you can purchase for a few thousand bucks. And even then it’s a drop in the bucket compared to ~16million new cars sold annually.
There is no market in the US for new Kei cars.
Nothing against Kei cars but are they really the answer?
The president could advocate for CAFE standard reforms that discourage the manufacture of smaller cars. But this would mean actually fixing the source of the problem and would put him in an politically untenable spot with his drill baby drill base or with auto manufactures who like selling high margin vehicles on 84 month loans.
Honestly I’d be curious to see how well they do. I don’t think we’re going to undo decades of marketing that pushed people into larger and more tech heavy vehicles overnight, if anything it’ll at least rustle the side by side market because wow those are outrageously expensive. 🙂
“…not as safe as…” How about you simply say, “Safer than ANY motorcycle of any age, new or used”? Now see how silly the hand-wringing is?
Yup, any argument about safety standards will continue to fall flat as long as motorcycles are legal for sale. Like, mandate a sticker or something “warning: this vehicle does not comply with federal crash safety standards” but forbidding people to do things because they are unsafe is the road to idiocracy.
I design and build highways. We have so many great ways that we are making the roads safer for vehicles in regards to crashes and the like. And then there’s motorcycles… what can you do to help them? Smoother roads, better bridge joints, etc. is about it. Heartbreaking every time I see a bad accident with a bike on the roads. I think how much better it could have been for them in a car.
and that’s before the helmet law argument enters the chat
Worse than the dramatic bike crashes, is that a relatively minor crash can be fatal or life changing.
I know a guy still struggling after someone turned in front of his bike.
He trying to deal with traumatic brain injury. He’s fallen through the cracks and gets almost no govt support.
I’m sorry to hear that. Bike TBIs are very hard to recover from.
They all are, and everyone is different.
And then you put guiderail in and realize that you really don’t want a motorcyclist to hit that guiderail.
I wish we could line the highways with like ball pits the kids play in and marshmallows sometimes. Even more now that my kids are driving.
I would love to talk to you about a highway proposal I have.
I can’t make discord work now though.
If it’s for flying cars or Dukes of Hazzard jumps – I’m already working on them. I dropped a ‘just make a jump’ joke in a meeting once about how we were going to rebuild a bridge with traffic. Went over like Rosco’s car… right into the barn.
I have actually gone fully airborne a few times and landed successfully, but I was responding to your saying you’re in highway design.
I have a spec design for high efficiency cars, combined with separated lanes and lighter paving for the far lighter traffic.
State highway engineers here told me they were already planning to separate truck and automobile traffic for safety and efficiency reasons. We have extremely high levels of truck traffic here, but I am unaware of any progress.
To my surprize, they were immediately supportive of my idea, saying any traffic on those cheaper lanes would support the lower expense. I proposed a 2000 pound limit.
They sent me breakdowns on construction for current semi traffic and costs.
I have heard of limited construction for cars only in other places, but none here.
I thought this site was staying out of politics. The comments are disappointing to say the least.
I like the possibility of buying a new LHD Kei class car! How hard was that to say without the snide remarks.
I mean, it’s nearly impossible to stay out of politics when CEOs are in the Oval Office talking about kei cars. However, trying to keep the name-calling towards one another down.
CEOs have been in the Oval Office for every President since the Oval Office was built.
Talking about Kei cars, though?
I can only think of a few ex CEO US Presidents in the past century:
Hoover
Carter (If you consider he was the CEO of his own farm)
Trump
The rest were not:
FDR – Government Worker/Professional Politician
Truman – Farmer/Haberdasher/Soldier
Eisenhower – Soldier
Kennedy – Soldier/Professional Politician
LBJ – School Teacher/Professional Politician
Nixon – Professional Politician
Ford – Professional Politician
Reagan – Actor
Bush I – Oilman/Government Worker/Professional Politician
Clinton – Lawyer/Professional Politician
Bush II – Nepo-Baby/Professional Politician
Obama – Attorney/Law Professor
None of these guys were in the Auto business either.
I’m sure he/she meant that they swing by for visits.
The DJT ‘businessman’ trope really is a stretch. He’s been excellent at selling illegal or extremely shady business practices. Not paying partners. Criminally convicted w/Trump steaks & Trump charity..Bankruptrupted 4 casinos for pete’s sakes. Crypto that is failing. NFTs, golden made in china shoes, ties, t-shirts, fake gold watches!?!, the list goes on.
None of above even gets in to the illegal activities while in the exec. branch.
Remember when exec. branch corruption was limited to benefiting your company to thr tunenof 10s of billions of dollars, supplementing the ‘workforce’of a country invasion on fake claims greater than 30% of the total force, via government contracts for literal mercenaries & via defense contracts in a company you had masdive material stakes (Chaney & Halliburton)?
Peppridge Farms Remembers
I didn’t sign that pledge. You are free not to read the comments that upset you.
“I thought this site was staying out of politics. “
One aspect of cars is the regulatory situation. And the regulatory situation is affected by politics.
Stop being daft.
wrong
It was pretty hilarious when “climate activists” began torching battery cars.
For the record, the oral-anal sphincter from which Trump spews utterly dazzling bullshit has emitted lots of other crap that he wouldn’t own up to afterward. So for the moment if I don’t take this is real, please excuse me.
IF….
Trump can’t just tell NHTSA to allow companies to build new Kei cars. There are a BUNCH of regulations that would need to be rewritten and passed along with changes to laws that require Congress acting. Then there is the fact that Trump fired many of the people that actually know how to write those regulations and the smallest mistake means the regulation is void and will be overturned in court.
(Lots and lots of new regulation written in Trump’s first term were overturned because his people didn’t follow the laws and procedures required)
This Kei car idea is exactly like a whole bunch of other things said in passing that never happen. How long ago did he say he was going to allow cars that meet EU standards to be imported to the USA?
The NHTSA has no authority to tell car makers what type of cars to build.
Yes, there are a bunch of OTHER regulations that are controlled by the government, but there is no reason those can’t be changed. That is not that uncommon – a few years ago there was a new classification to allow more around-town 3-wheeled vehicles.
I think I have been clear in my disdain for this president, so I am not supporting him, but I am supporting the idea that we should not be gridlocked by regulations. Adding a new classification that saves people money, while only allowing it in certain situations (i.e. lower speed, around town, etc) make a ton of sense. I hate that this idea is being brought up by [redacted], but it is one that both parties should be embracing.
Even a broken clock is right twice a day.
As car enthusiasts, we should be supporting the idea and help in writing that new classification as much as we can.
Comments pretty much covered a lot of the why it won’t work and isn’t feasible.
I think Trump just likes the idea of further delineating the poor from the rich.
Could side by side UTV manufacturers classify street legal versions of their products as kei cars?
If anything comes of this, I foresee those companies making such vehicles before I imagine the domestic auto manufacturers doing so (not counting captive imports).
Many states already allow SxS’s to be driven on the road. No federal law required.
To make a federal change to allow them takes a complete rewrite of automotive regulations in the USA.
Yep here in Montana they are all over the place. I get it we have more space per person than most states, but every time I see one, I think about how awesome one would be in an urban environment. The biggest negative is they all make the worst engine noise ever, but the second place 10 year old diesel rolling coal is just as annoying and legal everywhere*.
* I know rolling coal is illegal technically.
I think this is the winner. You’ll maybe see SxS on the road if this comes to pass. Where I live…they are already legally on the road, so (insert shoulder shrug emoji)
I’ve seen far too many UTVs on the road already lacking a lot of basic vehicle safety equipment; I’d much rather not see their casual disdain for the basics the rest of us own up to codified and given free rein.
Make them ride bicycles!
Oh “Trump said,” surely that means we can set our watch by that happening soon.
Just wanted to pop in and say that this comment section (with only a couple of exceptions) was exactly what I needed this morning, and reaffirmed my belief that this site is the very best combination of writing, reporting, and readership on the automotive internet. Bravo.
I read the whole article but I’m not sure if it’s a joke or not.
Same.
I would love to live in a timeline where I never had to hear this guy’s rambling, incoherent nonsense.
There are so many times I wish someone would reel him back in. Even with this – all he had to say was that ‘we are reducing the federal requirements for vehicle efficiency in order to allow the free market to shape what the country wants’.. easy. done.
Take heart that he’s an elderly, fat fuck.
God, he’s a moron. There isn’t even much of a market for small hatches. Sure, there are enthusiasts who would be interested but no auto manufacturer is going to try to sell those here. And then the regulations…..
Did he stay awake for the whole thing?